According to videos emerging on social media, a huge column of smoke can be seen rising from the area. Police have cordoned off the perimeter and urged passersby to avoid the area.
The fire started at "a car dealership," a local fire brigade said, releasing photos of the street engulfed in thick grey smoke on Twitter.
A total of 86 firefighters and 24 vehicles have been deployed to battle the blaze, the prefecture of Yvelines department, where Versailles is located, said.
The incident took place eight days after a destructive blaze engulfed the world renowned Notre Dame cathedral. The building was heavily damaged in the blaze, with two thirds of the cathedral's wooden roof having been destroyed in the fire.